This issue

- the public sector performance paradox
- managing the next crisis
- intergenerational well-being
- making commissioning work
- the potential and limits of economic statecraft
Plus what I’m reading. 

The public sector performance paradox 

Assessing performance in the public sector has led to several unintended consequences. These include the performance paradox where there is only a weak correlation between performance indicators and performance. A paper in Public Performance and Management Review argues these unintended consequences can reduce the quality of what we know about actual levels of performance or they can even negatively affect performance.

Read our brief on the article

Managing the next crisis

The phrase “a crisis is a terrible thing to waste” was originally used by Stanford University economist Paul Romer in 2002. Since then, it has been cited by luminaries such as Hillary Clinton and author Malcolm Gladwell.  

As nations move through the Delta variant of coronavirus and beyond, Romer’s comment may never be truer. A report from the IBM Center for Government captures lessons learned for future action, not just from the pandemic but similar past events. 

Principles for dealing with viral uncertainty The report outlines 12 principles for confronting and softening the impact of the next crisis. These include: 

1. Data is key to understanding a problem well enough to develop a solution. But the various players responding to a crisis must be able to communicate with one another using consistent terms, definitions and methodology for the data. 
2. Unlikely events that have high potential consequences still require preparation. Risk management can help weigh the odds and spell out plans for future calamities. 
3. When people face great risk, they must trust those who lead response and recovery—or those interventions are severely impeded. 
4. Holding institutions and individuals accountable helps ensure responsible actions. This requires knowing exactly how to define and measure success. 
   Read More

Intergenerational well-being: Baby boomers, generation X and millennials in Australia

A paper from ANU’s Tax and Transfer Policy Institute discusses the relative well-being of three generations:  

• baby boomers (born 1946 to 1964) 
• generation X (born 1965 to 1980) 
• millennials (born 1981 to 1996).  

Drawing on the OECD well-being framework, the paper examines income and wealth, housing, working conditions, health, education, environmental quality, social connections, safety and inequality. 

The paper found that millennials are considerably better off than the earlier generations in material well-being, physical health and education and are generally better off in working conditions. They are less well-off in mental health, some major environmental conditions and international security. There has been a small increase in inequality. Housing, social connections and domestic safety are mixed issues. 

At a glance 

• Using net national disposable income per capita, generation X had 27 per cent more real income than baby boomers. In turn, millennials were 51 per cent better off than generation X and 91 per cent better off than baby boomers. 
• Current housing renters are no worse off relative to their income than previous generations. Nor are homeowners worse off in terms of loan and interest payments relative to income. Both renters and homeowners are likely living in higher quality housing than 20 or 40 years ago. 
• At birth, life expectancy for millennials is eight years longer than for baby boomers and some five years longer than for generation X. At age 65, life expectancy for millennials is around four years longer than for baby boomers and some 2.5 years longer than for generation X. 
• Mental health issues have risen over time and have become significantly greater for millennials, and for more recent generations, than they were for generation X or baby boomers.

Making commissioning work

In theory, commissioning is a strategic and relational practice putting communities at the heart of decision-making. In practice, commissioning has proved less transformational. A paper in the Australian Journal of Public Administration explores the gulf between intent and implementation through the 
Commissioning Project, a collaborative project between the Sydney Policy Lab and a coalition of community sector peak organisations. 

The move to commissioning 
New public management and market-led frameworks have begun to give way to ideas of service design and delivery occurring within multi-faceted networks. This involves moving away from transactional governance to an increased focus on building relationships and trust. 

For government, relational practice represents a potentially challenging divergence from decades of practice and policy development, It requires working collaboratively with all communities to develop policy, design services and develop strong and genuine partnerships. 

What is commissioning? 
The commissioning of human services fit with this more relational and networked style of governance. Commissioning can be seen as: 

• a collaborative process to assess individual and community needs and assets, agree on outcomes, and design and evaluate the most efficient response to achieve outcomes over the short and long term. 

Better commissioning 
Successful commissioning relies on service providers, communities and service users being actively involved in the process. By comparison, commissioning initiatives that are implemented according to more transactional principles have not achieved the desired social or economic outcomes. 

The language of commissioning often used as a substitute for procurement or outsourcing, rather than a more strategic integration of purpose and action. As a result, there is an implementation gap between policy intent and actuality when it comes to commissioning. 

The collaborative project identified the following principles to facilitate better commissioning and bridge the gap: 

• putting relationships first 

• letting communities lead 

• investing in people 

• embedding learning. 

A geoeconomic alliance: the potential and limits of economic statecraft 

This United States Studies Centre report examines the potential and limits of geoeconomic statecraft in the context of the Australia-US alliance. 

What is geoeconomics? 
Geoeconomics is a way of conceptualising the relationship between geopolitics and framing policy issues that arise at the intersection of international economics and security. The rise of China and US-China strategic rivalry has sparked renewed interest in geoeconomic conceptions of great power competition.  

How effective is China’s economic statecraft? 
China’s use of geoeconomic policy instruments reflects the constraints on its ability to pursue its objectives through military, diplomatic and other policy. Its lack of allies in the international system constrains its ability to work cooperatively with other countries to promote its interests.  

China’s use of geoeconomics has a mixed track record of success with success dependent on the strategic context.

China’s geoeconomic influence is arguably greater with smaller and poorer countries than it is with developed countries like Australia. China’s use of geoeconomics is of a larger concern in the Indo-Pacific region than within an Australia-US alliance context. 

Towards an Australian geoeconomic policy agenda 
The growing relevance of geoeconomic statecraft has implications for Australian Government policy as well as for the Australia-US alliance. The G7 and the Quadrilateral Security Dialogue (USA, Japan, Australia and India) may be the best forums through which to address China’s economic coercion since it is only the collective economic weight of the United States, the European Union and Japan that is likely to threaten China with substantial economic costs. 

Ensuring policy is informed by a multidisciplinary perspective is a significant challenge. Economists with knowledge of foreign and defence policy represent an unusual skill set. International relations and strategic studies programs do not always provide rigorous training in economics and political economy. Cross-disciplinary training as part of public sector professional development programs should be encouraged.

1. You may be more original than you think 

Ideating on your own is a repeated process of generating and pruning  new ideas. By the end, you have  narrowed the field to one or two that you think are winners. But what if you have been making the process harder than it needs to be? Research from INSEAD has found that people systematically underestimate their originality throughout the ideation process. Read More

2. The great Hawaiian pizza culture war 

The Hawaiian pizza has become a contender for the most controversial dish ever made. This Economist article examines the debate over the merits (or failings) of pineapple on pizza. In an era defined by a propensity for polarisation, the debate has become a global pastime, As for me, pineapple is essential for a pina colada, not pizza. No further correspondence will be entered into. Read More

‘Til the next issue

Maria Katsonis